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Summary of Supply Chain Management
The supply chain not only includes the manufacturer and suppliers, but also transporters, warehouses, retailers, and customers themselves.
The supply chain includes all functions involved in receiving and filling a customer request.
Source: Chopra, Sunil and Peter Meindl. Supply
Chain Management. 2 ed. Upper Saddle River: Pearson Prentice Hall, 2004
- new product development,
- marketing,
- operations,
- distribution,
- finance,
- and customer service.
Supply Chain Management (SCM) is the process of planning, implementing, and controlling the operations of the supply chain with the purpose to satisfy customer requirements as efficiently as possible.
Source: The term supply chain
management was coined by consultant Keith
Oliver, of strategy consulting firm Booz Allen Hamilton in 1982
The supply chain is the total flow of materials,
information and cash, from the suppliers' suppliers, right through an
enterprise to the customers' customers
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgurqnFjMCmfQQSWzJEZeO7Hz57sTBjFGhkXO1ldGHUYosAMip6YBWtSuUqtQ0DzHuF0Q3n650U3gpxDHST3e3MMsts7dsQorlVL_diMuDf5l4E37lj3hB1TJz-0R6ubHelMAbCxbz-ePwW/s320/supply+chain+flows.png)
Based on thepicture, materials
flow one way; cash (ideally) flows in the opposite direction and information
needs be visible throughout to give control over what is happening in the
chain.
Supply Chain management is important, because it can drive strategy, it covers all the distribution and material movement in the world & impacts the cost and service at the company level.
Supply Chain Goals
Efficient
supply chain management must result in tangible business improvements. It is
characterized by a sharp focus on
–
Revenue
growth
–
Better
asset utilization
–
Cost
reduction.
Supply Chain Management Underlying Principles
- Compression (Planning/Manufacturing/Supply)
- Conformance ( Forecasts/Plans/Distribution)
- Co-operation (cross- functional)
- Communication (real time data)
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